Net Income of $15.4 million, EPS of $0.20

BOSTON, Oct. 18, 2017 (GLOBE NEWSWIRE) -- Brookline Bancorp, Inc. (NASDAQ:BRKL) (the “Company”) today announced net income of $15.4 million, or $0.20 per basic and diluted share, for the third quarter of 2017, compared to $14.9 million, or $0.20 per basic and diluted share, for the second quarter of 2017, and $13.6 million, or $0.19 per basic and diluted share, for the third quarter of 2016. The third quarter of 2017 net income included merger and acquisition costs in connection with the Company's Agreement and Plan of Merger with First Commons Bank, N.A. executed on September 20, 2017.

“We are pleased to report that Brookline Bancorp maintained its consistent strong performance throughout the third quarter of 2017,” said Paul Perrault, President and Chief Executive Officer of the Company. “During the quarter, we generated steady growth in loans and deposits. We look forward to our continued success in growing our loans and deposit base organically, and welcoming customers of First Commons Bank to the Brookline family.  The acquisition of First Commons Bank will add approximately $300 million in assets to our balance sheet in the first quarter of 2018 on condition of approval.”

BALANCE SHEET

Total assets at September 30, 2017 increased $28.2 million to $6.69 billion from $6.66 billion at June 30, 2017, and increased $306.0 million from $6.38 billion at September 30, 2016. At September 30, 2017, total loans and leases were $5.64 billion, representing an increase of $102.0 million from June 30, 2017, and an increase of $307.1 million from September 30, 2016. During the third quarter of 2017, total loans and leases increased 7.4 percent on an annualized basis.

Investment securities at September 30, 2017 decreased $19.3 million to $630.6 million, comprising 9.4 percent of total assets, as compared to $649.9 million, or 9.8 percent of total assets, at June 30, 2017, and increased approximately $29.3 million from $601.4 million, or 9.4 percent of total assets, at September 30, 2016.

Total deposits at September 30, 2017 increased $96.3 million to $4.81 billion from $4.71 billion at June 30, 2017 and increased $240.8 million from $4.56 billion at September 30, 2016. Core deposits, which consists of demand checking, NOW, savings, and money market accounts, increased $48.5 million from June 30, 2017 and increased $179.5 million from September 30, 2016.

Total borrowings at September 30, 2017 decreased $80.7 million to $985.9 million from $1.07 billion at June 30, 2017 and decreased $36.8 million from $1.02 billion at September 30, 2016.

The ratio of stockholders’ equity to total assets was 12.04 percent at September 30, 2017, as compared to 11.95 percent at June 30, 2017, and 10.91 percent at September 30, 2016, respectively. The ratio of tangible stockholders’ equity to tangible assets was 10.09 percent at September 30, 2017, as compared to 9.99 percent at June 30, 2017, and 8.82 percent at September 30, 2016. Tangible book value per share increased $0.11 from $8.52 at June 30, 2017 to $8.63 at September 30, 2017.

NET INTEREST INCOME

Net interest income increased $1.3 million to $56.8 million during the third quarter of 2017 from the quarter ended June 30, 2017. The net interest margin decreased 2 basis points to 3.57 percent for the three months ended September 30, 2017.

NON-INTEREST INCOME

Non-interest income for the quarter ended September 30, 2017 increased $1.5 million to $6.0 million from $4.5 million for the quarter ended June 30, 2017. The increase was primarily driven by increases of $0.7 million in loan level derivative income and in gain on sales of loans and leases.

PROVISION FOR CREDIT LOSSES

The Company recorded a provision for credit losses of $2.9 million for the quarter ended September 30, 2017, compared to $0.9 million for the quarter ended June 30, 2017. The increase in the provision for the quarter was primarily driven by growth in loans and an increase in the loss factors as a result of the ongoing assessment of loss factors.

Net charge-offs for the third quarter of 2017 were $2.0 million compared to $2.4 million in the second quarter of 2017. The ratio of net charge-offs to average loans and leases on an annualized basis decreased to 14 basis points for the third quarter of 2017 from 17 basis points for the second quarter of 2017. Net charge offs in the third quarter of 2017 primarily consisted of $1.3 million of taxi medallion loans and $0.3 million of equipment financing loans as compared to $2.3 million of commercial loans in the second quarter of 2017.

The allowance for loan and lease losses represented 1.16 percent of total loans and leases at September 30, 2017, compared to 1.17 percent at June 30, 2017, and 1.10 percent at September 30, 2016. The allowance for loan and lease losses related to originated loans and leases represented 1.20 percent of originated loans and leases at September 30, 2017, compared to 1.20 percent at June 30, 2017, and 1.15 percent at September 30, 2016. 

NON-INTEREST EXPENSE

Non-interest expense for the quarter ended September 30, 2017 increased $0.6 million to $35.4 million from $34.8 million for the quarter ended June 30, 2017. The increase was primarily driven by an increase of $0.2 million in compensation and employee benefits, an increase of $0.2 million in merger and acquisition expense, and an increase of $0.4 million in other non-interest expense, offset by a decrease of $0.1 million in FDIC insurance. The efficiency ratio for the third quarter was 56.37 percent compared to 57.93 percent for the second quarter of 2017 and 57.89 percent for the third quarter of 2016.

PROVISION FOR INCOME TAXES

The effective tax rate was 34.0 percent and 35.2 percent for the three and nine months ended September 30, 2017, respectively. The third quarter's effective tax rate was impacted by new accounting guidance that went into effect in 2017. This guidance requires that the excess tax benefit associated with stock compensation transactions be recorded through earnings as a discrete item within the Company's effective tax rate during the period of the transaction. The majority of the Company's stock compensation events typically occur in the third quarter. The prior guidance required the recognition of the excess tax benefit through additional paid in capital.

RETURNS ON AVERAGE ASSETS AND AVERAGE EQUITY

The annualized return on average assets increased to 0.92 percent during the third quarter of 2017 from 0.91 percent for the second quarter of 2017. The annualized return on average tangible assets increased to 0.94 percent for the third quarter of 2017 from 0.93 percent for the second quarter of 2017.

The annualized return on average stockholders' equity decreased to 7.64 percent during the third quarter of 2017 from 7.76 percent for the second quarter of 2017. The annualized return on average tangible stockholders’ equity decreased to 9.31 percent for the third quarter of 2017 from 9.58 percent for the second quarter of 2017.

ASSET QUALITY

The ratio of nonperforming loans and leases to total loans and leases was 0.71 percent at September 30, 2017 as compared to 0.76 percent at June 30, 2017. Nonperforming loans and leases decreased $2.3 million to $40.0 million at September 30, 2017 from $42.3 million at June 30, 2017. The ratio of nonperforming assets to total assets was 0.66 percent at September 30, 2017 as compared to 0.71 percent at June 30, 2017. Nonperforming assets decreased $2.8 million to $44.4 million at September 30, 2017 from $47.1 million at June 30, 2017. The decrease in nonperforming assets is due to the payoff of several nonperforming loans, charge offs of several taxi medallion loans, and sales of $0.5 million of other real estate owned and repossessed assets in the third quarter of 2017.

DIVIDEND DECLARED

The Company’s Board of Directors approved a dividend of $0.09 per share for the quarter ended September 30, 2017. The dividend will be paid on November 17, 2017 to stockholders of record on November 3, 2017.

CONFERENCE CALL

The Company will conduct a conference call/webcast at 1:30 PM Eastern Daylight Time on Thursday, October 19, 2017 to discuss the results for the quarter, business highlights and outlook. The call can be accessed by dialing 877-504-4120 (United States) or 412-902-6650 (internationally). A recorded playback of the call will be available for one week following the call at 877-344-7529 (United States) or 412-317-0088 (internationally). The passcode for the playback is 10112542. The call will be available live and in a recorded version on the Company’s website under “Investor Relations” at www.brooklinebancorp.com.

ABOUT BROOKLINE BANCORP, INC.

Brookline Bancorp, Inc., a bank holding company with $6.7 billion in assets and branch locations in Massachusetts and Rhode Island, is headquartered in Boston, Massachusetts and operates as the holding company for Brookline Bank, Bank Rhode Island, and First Ipswich Bank (the "banks"). The Company provides commercial and retail banking services, cash management and investment services to customers throughout Central New England. More information about Brookline Bancorp, Inc. and its banks can be found at the following websites: www.brooklinebank.com, www.bankri.com, and www.firstipswich.com.

FORWARD-LOOKING STATEMENTS

Certain statements contained in this press release that are not historical facts may constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties. The Company’s actual results could differ materially from those projected in the forward-looking statements as a result of, among others, the risks outlined in the Company’s Annual Report on Form 10-K, as updated by its Quarterly Reports on Form 10-Q and other filings submitted to the Securities and Exchange Commission ("SEC"). The Company does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made.

BASIS OF PRESENTATION

The Company's consolidated financial statements have been prepared in conformity with generally accepted accounting principles (“GAAP”) as set forth by the Financial Accounting Standards Board in its Accounting Standards Codification and through the rules and interpretive releases of the SEC under the authority of federal securities laws. Certain amounts previously reported have been reclassified to conform to the current period's presentation.

NON-GAAP FINANCIAL MEASURES

The Company uses certain non-GAAP financial measures, such as the allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases, tangible book value per common share, tangible stockholders’ equity to tangible assets, return on average tangible assets and return on average tangible stockholders' equity. These non-GAAP financial measures provide information for investors to effectively analyze financial trends of ongoing business activities, and to enhance comparability with peers across the financial services sector. A detailed reconciliation table of the Company's GAAP to the non-GAAP measures is attached.

Contact:

Carl M. Carlson

Brookline Bancorp, Inc.

Chief Financial Officer

(617) 425-5331

ccarlson@brkl.com

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Selected Financial Highlights (Unaudited)
	At and for the Three Months Ended
	September 30, 2017				June 30, 2017				March 31, 2017				December 31, 2016				September 30, 2016
	(Dollars In Thousands Except per Share Data)
Earnings Data:
Net interest income	$	56,843			$	55,583			$	53,098			$	51,854			$	52,350
Provision for credit losses		2,911				873				13,402				3,215				2,215
Non-interest income		5,973				4,477				15,908				5,430				5,329
Non-interest expense		35,408				34,795				33,756				32,607				33,388
Income before provision for income taxes		24,497				24,392				21,848				21,462				22,076
Net income attributable to Brookline Bancorp, Inc.		15,366				14,880				13,445				13,279				13,617
Performance Ratios:
Net interest margin (1)		3.57	%			3.59	%			3.53	%			3.40	%			3.48	%
Interest-rate spread (1)		3.41	%			3.39	%			3.29	%			3.24	%			3.32	%
Return on average assets (annualized)		0.92	%			0.91	%			0.83	%			0.83	%			0.86	%
Return on average tangible assets (annualized) (non-GAAP)		0.94	%			0.93	%			0.85	%			0.85	%			0.88	%
Return on average stockholders' equity (annualized)		7.64	%			7.76	%			7.58	%			7.59	%			7.83	%
Return on average tangible stockholders' equity (annualized) (non-GAAP)		9.31	%			9.58	%			9.55	%			9.60	%			9.94	%
Efficiency ratio (2)		56.37	%			57.93	%			48.92	%			56.92	%			57.89	%
Per Common Share Data:
Net income — Basic	$	0.20			$	0.20			$	0.19			$	0.19			$	0.19
Net income — Diluted		0.20				0.20				0.19				0.19				0.19
Cash dividends declared		0.09				0.09				0.09				0.09				0.09
Book value per share (end of period)		10.52				10.42				10.00				9.88				9.90
Tangible book value per share (end of period) (non-GAAP)		8.63				8.52				7.93				7.81				7.81
Stock price (end of period)		15.50				14.60				15.65				16.40				12.19
Balance Sheet:
Total assets	$	6,686,284			$	6,658,067			$	6,497,721			$	6,438,129			$	6,380,312
Total loans and leases		5,639,440				5,537,406				5,461,779				5,398,864				5,332,300
Total deposits		4,805,683				4,709,419				4,651,903				4,611,076				4,564,906
Brookline Bancorp, Inc. stockholders’ equity		804,762				795,618				703,873				695,544				696,371
Asset Quality:
Nonperforming assets	$	44,371			$	47,140			$	47,349			$	41,476			$	38,704
Nonperforming assets as a percentage of total assets		0.66	%			0.71	%			0.73	%			0.64	%			0.61	%
Allowance for loan and lease losses	$	65,413			$	64,521			$	66,133			$	53,666			$	58,892
Allowance for loan and lease losses as a percentage of total loans and leases		1.16	%			1.17	%			1.21	%			0.99	%			1.10	%
Net loan and lease charge-offs	$	1,954			$	2,402			$	995			$	8,337			$	520
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)		0.14	%			0.17	%			0.07	%			0.62	%			0.04	%
Capital Ratios:
Stockholders’ equity to total assets		12.04	%			11.95	%			10.83	%			10.80	%			10.91	%
Tangible stockholders’ equity to tangible assets (non-GAAP)		10.09	%			9.99	%			8.79	%			8.73	%			8.82	%
(1) Calculated on a fully tax-equivalent basis.
(2) Calculated as non-interest expense as a percentage of net interest income plus non-interest income.

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (Unaudited)
		September 30, 2017				June 30, 2017				March 31, 2017				December 31, 2016				September 30, 2016
ASSETS		(In Thousands Except Share Data)
Cash and due from banks		$	35,392			$	40,599			$	33,565			$	36,055			$	32,196
Short-term investments			27,971				72,996				29,178				31,602				32,351
Total cash and cash equivalents			63,363				113,595				62,743				67,657				64,547
Investment securities available-for-sale			522,910				540,976				528,433				523,634				524,295
Investment securities held-to-maturity			107,738				108,963				100,691				87,120				77,094
Total investment securities			630,648				649,939				629,124				610,754				601,389
Loans and leases held-for-sale			2,973				593				1,152				13,078				21,109
Loans and leases:
Commercial real estate loans:
Commercial real estate mortgage			2,119,440				2,062,646				2,066,599				2,050,382				2,038,477
Multi-family mortgage			743,912				720,484				733,822				731,186				703,743
Construction			165,657				153,057				150,734				136,999				141,208
Total commercial real estate loans			3,029,009				2,936,187				2,951,155				2,918,567				2,883,428
Commercial loans and leases:
Commercial			689,010				691,070				644,240				635,426				652,316
Equipment financing			842,516				839,932				815,753				799,860				764,647
Condominium association			53,770				58,130				60,396				60,122				53,903
Total commercial loans and leases			1,585,296				1,589,132				1,520,389				1,495,408				1,470,866
Consumer loans:
Residential mortgage			652,415				646,679				631,863				624,349				617,065
Home equity			356,982				351,124				343,386				342,241				340,954
Other consumer			15,738				14,284				14,986				18,299				19,987
Total consumer loans			1,025,135				1,012,087				990,235				984,889				978,006
Total loans and leases			5,639,440				5,537,406				5,461,779				5,398,864				5,332,300
Allowance for loan and lease losses			(65,413	)			(64,521	)			(66,133	)			(53,666	)			(58,892	)
Net loans and leases			5,574,027				5,472,885				5,395,646				5,345,198				5,273,408
Restricted equity securities			62,135				66,988				68,065				64,511				65,683
Premises and equipment, net of accumulated depreciation			81,159				81,052				76,973				76,176				75,462
Deferred tax asset			28,093				26,982				29,859				25,247				22,894
Goodwill			137,890				137,890				137,890				137,890				137,890
Identified intangible assets, net of accumulated amortization			6,563				7,082				7,601				8,133				8,754
Other real estate owned and repossessed assets			4,398				4,873				2,286				1,399				1,152
Other assets			95,035				96,188				86,382				88,086				108,024
Total assets		$	6,686,284			$	6,658,067			$	6,497,721			$	6,438,129			$	6,380,312
LIABILITIES AND STOCKHOLDERS' EQUITY
Deposits:
Non-interest-bearing deposits:
Demand checking accounts		$	905,472			$	920,035			$	898,161			$	900,474			$	889,278
Interest-bearing deposits:
NOW accounts			318,284				321,982				321,392				323,160				298,629
Savings accounts			665,558				584,408				575,808				613,061				591,156
Money market accounts			1,749,040				1,763,443				1,765,895				1,733,359				1,679,797
Certificate of deposit accounts			1,167,329				1,119,551				1,090,647				1,041,022				1,106,046
Total interest-bearing deposits			3,900,211				3,789,384				3,753,742				3,710,602				3,675,628
Total deposits			4,805,683				4,709,419				4,651,903				4,611,076				4,564,906
Borrowed funds:
Advances from the FHLBB			872,579				930,028				930,001				910,774				900,971
Subordinated debentures and notes			83,229				83,188				83,147				83,105				83,043
Other borrowed funds			30,087				53,427				43,637				50,207				38,639
Total borrowed funds			985,895				1,066,643				1,056,785				1,044,086				1,022,653
Mortgagors’ escrow accounts			8,151				7,714				8,032				7,645				8,166
Accrued expenses and other liabilities			74,019				71,232				69,752				72,573				81,670
Total liabilities			5,873,748				5,855,008				5,786,472				5,735,380				5,677,395
Stockholders' equity:
Brookline Bancorp, Inc. stockholders’ equity:
Common stock, $0.01 par value; 200,000,000 shares authorized; 81,695,695 shares issued, 81,695,695 shares issued, 75,744,445 shares issued, 75,744,445 shares issued, and 75,744,445 shares issued, respectively			817				817				757				757				757
Additional paid-in capital			700,624				699,923				617,364				616,734				616,142
Retained earnings, partially restricted			160,225				151,759				143,766				136,671				129,740
Accumulated other comprehensive (loss) income			(1,893	)			(2,175	)			(3,261	)			(3,818	)			4,896
Treasury stock, at cost;
4,572,954 shares, 4,717,775 shares, 4,707,096 shares, 4,707,096 shares, and 4,734,512 shares, respectively			(54,188	)			(53,837	)			(53,837	)			(53,837	)			(54,151	)
Unallocated common stock held by the Employee Stock Ownership Plan;
150,921 shares, 159,510 shares, 168,099 shares, 176,688 shares, and 185,787 shares, respectively			(823	)			(869	)			(916	)			(963	)			(1,013	)
Total Brookline Bancorp, Inc. stockholders’ equity			804,762				795,618				703,873				695,544				696,371
Noncontrolling interest in subsidiary			7,774				7,441				7,376				7,205				6,546
Total stockholders' equity			812,536				803,059				711,249				702,749				702,917
Total liabilities and stockholders' equity		$	6,686,284			$	6,658,067			$	6,497,721			$	6,438,129			$	6,380,312

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
		Three Months Ended
		September 30, 2017			June 30, 2017			March 31, 2017			December 31, 2016			September 30, 2016
		(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases		$	63,054		$	61,138		$	58,558		$	57,247		$	57,858
Debt securities			3,154			3,156			3,000			2,881			2,822
Marketable and restricted equity securities			788			797			726			762			804
Short-term investments			180			95			67			93			47
Total interest and dividend income			67,176			65,186			62,351			60,983			61,531
Interest expense:
Deposits			5,984			5,543			5,080			5,195			5,112
Borrowed funds			4,349			4,060			4,173			3,934			4,069
Total interest expense			10,333			9,603			9,253			9,129			9,181
Net interest income			56,843			55,583			53,098			51,854			52,350
Provision for credit losses			2,911			873			13,402			3,215			2,215
Net interest income after provision for credit losses			53,932			54,710			39,696			48,639			50,135
Non-interest income:
Deposit fees			2,547			2,552			2,409			2,263			2,289
Loan fees			282			229			261			322			330
Loan level derivative income, net			844			186			402			265			858
Gain on sales of investment securities, net			—			—			11,393			—			—
Gain on sales of loans and leases held-for-sale			1,049			307			353			1,270			588
Other			1,251			1,203			1,090			1,310			1,264
Total non-interest income			5,973			4,477			15,908			5,430			5,329
Non-interest expense:
Compensation and employee benefits			21,067			20,910			19,784			19,657			20,369
Occupancy			3,650			3,657			3,645			3,520			3,411
Equipment and data processing			4,210			4,164			4,063			4,028			3,826
Professional services			973			1,036			1,106			927			997
FDIC insurance			842			951			855			655			956
Advertising and marketing			839			857			817			823			844
Amortization of identified intangible assets			519			519			532			621			623
Merger and acquisition expense			205			—			—			—			—
Other			3,103			2,701			2,954			2,376			2,362
Total non-interest expense			35,408			34,795			33,756			32,607			33,388
Income before provision for income taxes			24,497			24,392			21,848			21,462			22,076
Provision for income taxes			8,330			8,759			7,835			7,524			7,804
Net income before noncontrolling interest in subsidiary			16,167			15,633			14,013			13,938			14,272
Less net income attributable to noncontrolling interest in subsidiary			801			753			568			659			655
Net income attributable to Brookline Bancorp, Inc.		$	15,366		$	14,880		$	13,445		$	13,279		$	13,617
Earnings per common share:
Basic		$	0.20		$	0.20		$	0.19		$	0.19		$	0.19
Diluted		$	0.20		$	0.20		$	0.19		$	0.19		$	0.19
Weighted average common shares outstanding during the period:
Basic			76,452,539			74,325,013			70,386,766			70,362,702			70,299,722
Diluted			76,961,948			74,810,088			70,844,096			70,592,204			70,450,760
Dividends declared per common share		$	0.09		$	0.09		$	0.09		$	0.09		$	0.09

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Consolidated Statements of Income (Unaudited)
		Nine Months Ended September 30,
			2017			2016
		(In Thousands Except Share Data)
Interest and dividend income:
Loans and leases		$	182,750		$	167,474
Debt securities			9,310			8,829
Marketable and restricted equity securities			2,311			2,213
Short-term investments			342			149
Total interest and dividend income			194,713			178,665
Interest expense:
Deposits			16,607			14,875
Borrowed funds			12,582			11,980
Total interest expense			29,189			26,855
Net interest income			165,524			151,810
Provision for credit losses			17,186			7,138
Net interest income after provision for credit losses			148,338			144,672
Non-interest income:
Deposit Fees			7,508			6,650
Loan Fees			772			977
Loan level derivative income, net			1,432			3,697
Gain on sales of investment securities, net			11,393			—
Gain on sales of loans and leases held-for-sale			1,709			1,986
Other			3,544			3,893
Total non-interest income			26,358			17,203
Non-interest expense:
Compensation and employee benefits			61,761			58,179
Occupancy			10,952			10,328
Equipment and data processing			12,437			11,468
Professional services			3,115			2,925
FDIC insurance			2,648			2,677
Advertising and marketing			2,513			2,558
Amortization of identified intangible assets			1,570			1,879
Merger and acquisition expense			205			—
Other			8,758			7,707
Total non-interest expense			103,959			97,721
Income before provision for income taxes			70,737			64,154
Provision for income taxes			24,924			22,868
Net income before noncontrolling interest in subsidiary			45,813			41,286
Less net income attributable to noncontrolling interest in subsidiary			2,122			2,203
Net income attributable to Brookline Bancorp, Inc.		$	43,691		$	39,083
Earnings per common share:
Basic		$	0.59		$	0.56
Diluted		$	0.59		$	0.56
Weighted average common shares outstanding during the period:
Basic			73,743,658			70,228,127
Diluted			74,226,316			70,394,465
Dividends declared per common share		$	0.27		$	0.27

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Asset Quality Analysis (Unaudited)
		At and for the Three Months Ended
		September 30, 2017				June 30, 2017				March 31, 2017				December 31, 2016				September 30, 2016
		(Dollars in Thousands)
NONPERFORMING ASSETS:
Loans and leases accounted for on a nonaccrual basis:
Commercial real estate mortgage		$	3,051			$	2,766			$	5,671			$	5,340			$	1,688
Multi-family mortgage			792				1,075				1,095				1,404				1,418
Construction			860				—				—				—				—
Total commercial real estate loans			4,703				3,841				6,766				6,744				3,106
Commercial			22,367				23,886				27,442				22,974				24,051
Equipment financing			9,858				9,702				6,445				6,758				6,652
Total commercial loans and leases			32,225				33,588				33,887				29,732				30,703
Residential mortgage			1,969				3,429				3,001				2,501				1,749
Home equity			1,047				1,366				1,333				951				1,780
Other consumer			29				43				76				149				214
Total consumer loans			3,045				4,838				4,410				3,601				3,743
Total nonaccrual loans and leases			39,973				42,267				45,063				40,077				37,552
Other real estate owned			3,235				3,384				618				618				367
Other repossessed assets			1,163				1,489				1,668				781				785
Total nonperforming assets		$	44,371			$	47,140			$	47,349			$	41,476			$	38,704
Loans and leases past due greater than 90 days and still accruing		$	2,523			$	2,706			$	6,515			$	7,077			$	8,275
Troubled debt restructurings on accrual			14,024				14,732				13,662				13,883				16,303
Troubled debt restructurings on nonaccrual			15,290				16,146				11,756				11,919				15,715
Total troubled debt restructurings		$	29,314			$	30,878			$	25,418			$	25,802			$	32,018
Nonperforming loans and leases as a percentage of total loans and leases			0.71	%			0.76	%			0.83	%			0.74	%			0.70	%
Nonperforming assets as a percentage of total assets			0.66	%			0.71	%			0.73	%			0.64	%			0.61	%
PROVISION AND ALLOWANCE FOR LOAN AND LEASE LOSSES:
Allowance for loan and lease losses at beginning of period		$	64,521			$	66,133			$	53,666			$	58,892			$	57,258
Charge-offs			(2,143	)			(3,365	)			(1,382	)			(8,629	)			(839	)
Recoveries			189				963				387				292				319
Net charge-offs			(1,954	)			(2,402	)			(995	)			(8,337	)			(520	)
Provision for loan and lease losses			2,846				790				13,462				3,111				2,154
Allowance for loan and lease losses at end of period		$	65,413			$	64,521			$	66,133			$	53,666			$	58,892
Allowance for loan and lease losses as a percentage of total loans and leases			1.16	%			1.17	%			1.21	%			0.99	%			1.10	%
Allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases (non-GAAP)			1.20	%			1.20	%			1.25	%			1.03	%			1.15	%
NET CHARGE-OFFS:
Commercial real estate loans		$	65			$	(131	)		$	(116	)		$	635			$	50
Commercial loans and leases			1,856				2,546				1,065				7,119				375
Consumer loans			33				(13	)			46				583				95
Total net charge-offs		$	1,954			$	2,402			$	995			$	8,337			$	520
Net loan and lease charge-offs as a percentage of average loans and leases (annualized)			0.14	%			0.17	%			0.07	%			0.62	%			0.04	%

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
	Three Months Ended
	September 30, 2017										June 30, 2017										September 30, 2016
	Average Balance				Interest (1)			Average Yield/ Cost			Average Balance				Interest (1)			Average Yield/ Cost			Average Balance				Interest (1)			Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)	$	642,018			$	3,264		2.03	%		$	638,798			$	3,267		2.05	%		$	604,394			$	2,910		1.93	%
Marketable and restricted equity securities (2)		66,212				789		4.76	%			68,629				799		4.66	%			66,981				836		4.99	%
Short-term investments		52,674				180		1.36	%			43,739				95		0.87	%			36,273				47		0.51	%
Total investments		760,904				4,233		2.23	%			751,166				4,161		2.22	%			707,648				3,793		2.14	%
Loans and Leases:
Commercial real estate loans (3)		2,974,185				31,299		4.12	%			2,942,927				30,368		4.08	%			2,872,733				29,470		4.10	%
Commercial loans (3)		760,115				7,959		4.10	%			728,014				7,665		4.17	%			717,265				7,130		3.90	%
Equipment financing (3)		846,027				13,983		6.61	%			826,877				13,810		6.68	%			759,622				12,189		6.42	%
Residential mortgage loans (3)		649,831				6,043		3.72	%			639,449				5,859		3.67	%			620,741				5,513		3.55	%
Other consumer loans (3)		369,925				4,015		4.30	%			362,404				3,677		4.07	%			356,516				3,810		4.24	%
Total loans and leases		5,600,083				63,299		4.52	%			5,499,671				61,379		4.46	%			5,326,877				58,112		4.36	%
Total interest-earning assets		6,360,987				67,532		4.25	%			6,250,837				65,540		4.19	%			6,034,525				61,905		4.10	%
Allowance for loan and lease losses		(65,140	)									(66,853	)									(58,032	)
Non-interest-earning assets		385,195										372,681										383,604
Total assets	$	6,681,042									$	6,556,665									$	6,360,097
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts	$	321,731				55		0.07	%		$	316,486				54		0.07	%		$	295,762				52		0.07	%
Savings accounts		605,303				306		0.20	%			592,150				300		0.20	%			566,192				318		0.22	%
Money market accounts		1,765,610				2,267		0.51	%			1,767,973				2,131		0.48	%			1,678,937				1,905		0.45	%
Certificates of deposit		1,139,699				3,356		1.17	%			1,101,094				3,058		1.11	%			1,112,831				2,837		1.01	%
Total interest-bearing deposits		3,832,343				5,984		0.62	%			3,777,703				5,543		0.59	%			3,653,722				5,112		0.56	%
Borrowings
Advances from the FHLBB		913,206				3,028		1.30	%			896,565				2,755		1.22	%			921,396				2,778		1.18	%
Subordinated debentures and notes		83,204				1,274		6.13	%			83,165				1,271		6.11	%			83,036				1,259		6.07	%
Other borrowed funds		41,368				47		0.45	%			47,466				34		0.29	%			46,417				32		0.27	%
Total borrowings		1,037,778				4,349		1.64	%			1,027,196				4,060		1.56	%			1,050,849				4,069		1.52	%
Total interest-bearing liabilities		4,870,121				10,333		0.84	%			4,804,899				9,603		0.80	%			4,704,571				9,181		0.78	%
Non-interest-bearing liabilities:
Demand checking accounts		918,054										900,302										863,854
Other non-interest-bearing liabilities		80,616										77,682										90,025
Total liabilities		5,868,791										5,782,883										5,658,450
Brookline Bancorp, Inc. stockholders’ equity		804,666										766,529										695,205
Noncontrolling interest in subsidiary		7,585										7,253										6,442
Total liabilities and equity	$	6,681,042									$	6,556,665									$	6,360,097
Net interest income (tax-equivalent basis) /Interest-rate spread (4)						57,199		3.41	%							55,937		3.39	%							52,724		3.32	%
Less adjustment of tax-exempt income						356										354										374
Net interest income					$	56,843									$	55,583									$	52,350
Net interest margin (5)								3.57	%									3.59	%									3.48	%
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Average Yields / Costs (Unaudited)
	Nine Months Ended
	September 30, 2017										September 30, 2016
	Average Balance				Interest (1)			Average Yield/ Cost			Average Balance				Interest (1)			Average Yield/ Cost
	(Dollars in Thousands)
Assets:
Interest-earning assets:
Investments:
Debt securities (2)	$	631,549			$	9,641		2.04	%		$	604,603			$	9,078		2.00	%
Marketable and restricted equity securities (2)		68,104				2,306		4.52	%			66,764				2,247		4.49	%
Short-term investments		42,922				342		1.06	%			46,198				149		0.43	%
Total investments		742,575				12,289		2.21	%			717,565				11,474		2.13	%
Loans and Leases:
Commercial real estate loans (3)		2,949,313				91,134		4.07	%			2,785,472				85,014		4.07	%
Commercial loans (3)		730,453				22,737		4.11	%			692,634				20,430		3.88	%
Equipment financing (3)		826,494				40,907		6.60	%			738,990				35,690		6.44	%
Residential mortgage loans (3)		641,443				17,511		3.64	%			624,102				16,705		3.57	%
Other consumer loans (3)		364,407				11,187		4.10	%			350,070				10,389		3.95	%
Total loans and leases		5,512,110				183,476		4.44	%			5,191,268				168,228		4.32	%
Total interest-earning assets		6,254,685				195,765		4.17	%			5,908,833				179,702		4.05	%
Allowance for loan and lease losses		(62,142	)									(57,982	)
Non-interest-earning assets		374,558										379,761
Total assets	$	6,567,101									$	6,230,612
Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Deposits:
NOW accounts	$	319,633				164		0.07	%		$	289,908				156		0.07	%
Savings accounts		603,814				916		0.20	%			561,798				998		0.24	%
Money market accounts		1,759,449				6,407		0.49	%			1,654,700				5,547		0.45	%
Certificates of deposit		1,088,011				9,120		1.12	%			1,107,600				8,174		0.99	%
Total interest-bearing deposits		3,770,907				16,607		0.59	%			3,614,006				14,875		0.55	%
Borrowings
Advances from the FHLBB		913,137				8,640		1.25	%			888,406				8,125		1.20	%
Subordinated debentures and notes		83,165				3,805		6.10	%			82,996				3,773		6.06	%
Other borrowed funds		49,752				137		0.37	%			42,463				82		0.26	%
Total borrowings		1,046,054				12,582		1.59	%			1,013,865				11,980		1.55	%
Total interest-bearing liabilities		4,816,961				29,189		0.81	%			4,627,871				26,855		0.78	%
Non-interest-bearing liabilities:
Demand checking accounts		905,684										829,659
Other non-interest-bearing liabilities		76,735										80,774
Total liabilities		5,799,380										5,538,304
Brookline Bancorp, Inc. stockholders’ equity		760,447										686,134
Noncontrolling interest in subsidiary		7,274										6,174
Total liabilities and equity	$	6,567,101									$	6,230,612
Net interest income (tax-equivalent basis) /Interest-rate spread (4)						166,576		3.36	%							152,847		3.27	%
Less adjustment of tax-exempt income						1,052										1,037
Net interest income					$	165,524									$	151,810
Net interest margin (5)								3.56	%									3.46	%
(1) Tax-exempt income on debt securities, equity securities and revenue bonds included in commercial real estate loans is included on a tax-equivalent basis.
(2) Average balances include unrealized gains (losses) on investment securities. Dividend payments may not be consistent and average yield on equity securities may vary from month to month.
(3) Loans on nonaccrual status are included in the average balances.
(4) Interest rate spread represents the difference between the yield on interest-earning assets and the cost of interest-bearing liabilities.
(5) Net interest margin represents net interest income (tax-equivalent basis) divided by average interest-earning assets on an actual/actual basis.

 

BROOKLINE BANCORP, INC. AND SUBSIDIARIES
Non-GAAP Financial Information (Unaudited)
						At and for the Three Months Ended September 30,								At and for the Nine Months Ended    September 30,
							2017				2016				2017				2016
Reconciliation Table - Non-GAAP Financial Information						(Dollars in Thousands Except Share Data)
Net income attributable to Brookline Bancorp, Inc.						$	15,366			$	13,617			$	43,691			$	39,083
Add:
Merger and acquisition-related expenses (after-tax)							135				—				133				—
Net earnings from operations						$	15,501			$	13,617			$	43,824			$	39,083
Operating earnings per common share:
Basic						$	0.20			$	0.19			$	0.59			$	0.56
Diluted							0.20				0.19				0.59				0.56
Weighted average common shares outstanding during the period:
Basic							76,452,539				70,299,722				73,743,658				70,228,127
Diluted							76,961,948				70,450,760				74,226,316				70,394,465
		At and for the Three Months Ended
		September 30, 2017				June 30, 2017				March 31, 2017				December 31, 2016				September 30, 2016
		(Dollars in Thousands)
Net income, as reported		$	15,366			$	14,880			$	13,445			$	13,279			$	13,617
Average total assets		$	6,681,042			$	6,556,665			$	6,461,183			$	6,425,983			$	6,360,097
Less: Average goodwill and average identified intangible assets, net			144,747				145,269				145,778				146,382				146,997
Average tangible assets		$	6,536,295			$	6,411,396			$	6,315,405			$	6,279,601			$	6,213,100
Return on average tangible assets (annualized)			0.94	%			0.93	%			0.85	%			0.85	%			0.88	%
Average total stockholders’ equity		$	804,666			$	766,529			$	709,095			$	699,749			$	695,205
Less: Average goodwill and average identified intangible assets, net			144,747				145,269				145,778				146,382				146,997
Average tangible stockholders’ equity		$	659,919			$	621,260			$	563,317			$	553,367			$	548,208
Return on average tangible stockholders’ equity (annualized)			9.31	%			9.58	%			9.55	%			9.60	%			9.94	%
Brookline Bancorp, Inc. stockholders’ equity		$	804,762			$	795,618			$	703,873			$	695,544			$	696,371
Less:
Goodwill			137,890				137,890				137,890				137,890				137,890
Identified intangible assets, net			6,563				7,082				7,601				8,133				8,754
Tangible stockholders' equity		$	660,309			$	650,646			$	558,382			$	549,521			$	549,727
Total assets		$	6,686,284			$	6,658,067			$	6,497,721			$	6,438,129			$	6,380,312
Less:
Goodwill			137,890				137,890				137,890				137,890				137,890
Identified intangible assets, net			6,563				7,082				7,601				8,133				8,754
Tangible assets		$	6,541,831			$	6,513,095			$	6,352,230			$	6,292,106			$	6,233,668
Tangible stockholders’ equity to tangible assets			10.09	%			9.99	%			8.79	%			8.73	%			8.82	%
Tangible stockholders' equity		$	660,309			$	650,646			$	558,382			$	549,521			$	549,727
Number of common shares issued			81,695,695				81,695,695				75,744,445				75,744,445				75,744,445
Less:
Treasury shares			4,572,954				4,717,775				4,707,096				4,707,096				4,734,512
Unallocated ESOP shares			150,921				159,510				168,099				176,688				185,787
Unvested restricted shares			471,702				457,966				476,854				476,854				476,938
Number of common shares outstanding			76,500,118				76,360,444				70,392,396				70,383,807				70,347,208
Tangible book value per common share		$	8.63			$	8.52			$	7.93			$	7.81			$	7.81
Allowance for loan and lease losses		$	65,413			$	64,521			$	66,133			$	53,666			$	58,892
Less:
Allowance for acquired loans and leases losses			1,003				1,188				1,304				1,253				1,640
Allowance for originated loan and lease losses		$	64,410			$	63,333			$	64,829			$	52,413			$	57,252
Total loans and leases		$	5,639,440			$	5,537,406			$	5,461,779			$	5,398,864			$	5,332,300
Less:
Total acquired loans and leases			260,196				271,157				295,055				315,304				346,377
Total originated loans and leases		$	5,379,244			$	5,266,249			$	5,166,724			$	5,083,560			$	4,985,923
Allowance for loan and lease losses related to originated loans and leases as a percentage of originated loans and leases			1.20	%			1.20	%			1.25	%			1.03	%			1.15	%

 

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